What we know about the trends, prospects, and challenges of human resource outsourcing: A systematic literature review

This study aims to comprehensively review the literature on human resource outsourcing (HRO) published from 2001 to 2021. The study begins with metadata analysis on 69 papers and presents insights into 32 papers on HRO identified from the Scopus and ISI Web of Science databases. The literature is classified based on content analysis, which comprises conceptual understanding, drivers and barriers, functions outsourced, and firm performance. The study reveals that cost advantage, organisational learning, and the opportunity to concentrate on core business functions motivate the organisation to practice HRO. However, the lack of psychological contact among current employees, the risk of opportunism in the freelancing organisation, lack of management legislation, and prior experience are the common barriers to HRO adoption. Despite thesedrawbacks and barriers, recruitment, payroll processing, and technology-centric human resource (HR) activities are standard HR functions outsourced by organisations. The contributions of this study are to offer an integrated and conclusive definition of HRO and provide a simple, easy-to-understand, yet comprehensive framework for understanding HRO practices in any organisation. Researchers and academicians can utilize this paper to explore future research directions while gaining a thorough understanding of the HRO concept.